UBS stepping in to save Credit Suisse with a $3.2-billion acquisition has provided the beleaguered Swiss bank's India employees a glimmer of hope. The surprise deal - engineered by the Swiss government - has triggered optimism of fewer job losses at Credit Suisse's India unit and better synergies at key verticals, such as wealth management and investment banking. "UBS is a much stronger hand. Coming within its fold will give Credit Suisse's wealth management and investment banking divisions a good home.
'Our preference remains for the less-expensive industrial stocks, which are showing good earnings momentum.'
After several years of downgrades to the country's medium-term growth outlook, the estimates are likely to be upgraded now, Credit Suisse said in a report. The country's economy is showing signs of bottoming out, it said. According to the report, the consensus forecasts of GDP growth for FY2022 over FY2020 stopped falling after October 2020 (currently at (-) 1 per cent). Analysts at Credit Suisse expect these estimates to be revised upwards.
Swiss brokerage Credit Suisse expects the economy to continue to show positive surprises and record up to 9 per cent growth in the next fiscal. For the current financial year too, the brokerage anticipates growth to be higher than the consensus forecast of 8.4-9.5 per cent, and printing in at around 10.5 per cent. As a policy, Credit Suisse does not provide absolute growth numbers in its forecast.
Citing the impact of the second wave of the pandemic over the economy and consumer sentiment, Swiss brokerage Credit Suisse has lowered its nominal GDP growth forecast by 150-300 bps to 13-14 per cent, but expects a stronger recovery in the second half as it sees the lockdowns having limited impact on tax collections. Last month, Neelkanth Mishra, the co-head of equity strategy for Credit Suisse Asia Pacific, and India equity strategist, had told PTI that he expected the real GDP to fall to 8.5-9 per cent in FY22 due to the more severe pandemic attack. The virus case load has crossed the 25-million mark, death toll from the same is nearing 2.9 lakh mark, which is one of the highest in the world as the test positivity rate has been around 15 per cent for long.
The first was wholesale funded banks and non-bank finance companies.
The improving earnings and economic outlook has titled the scales back in favour of Indian equities this year, reports Pavan Burugula.
The bull run in the Indian equity markets is intact, said analysts at Morgan Stanley in a recent note. They expect the S&P BSE Sensex to hit 80,000 levels by December 2023 in their bull-case scenario, to which they have assigned a 30 per cent probability. From the current level, this translates into an upside of nearly 29 per cent.
While analysts remains overweight on financials, property, discretionary, industrials and materials, they maintain a neutral stance on pharma, telecom and energy; and underweight on staples, utilities, and IT services.
Experts say the market is more bullish on the BJP as it will ensure continuity in policymaking.
The next key battle the market will watch out for will be in Congress-ruled Karnataka
These unicorns, or startups valued at over USD 1 billion, are across industries, beyond technology and tech-enabled sectors as well, like pharmaceuticals, and consumer goods, Credit Suisse India equity strategist Neelkanth Mishra told reporters in Mumbai.
The global turmoil in the banking sector has made analysts cautious, who advise that investors stay away from stocks of this sector till the overall sentiment improves. The recent trouble for the banking sector started with the collapse of US-based Silicon Valley Bank (SVB), Silvergate Capital and Signature Bank. On its part, Moody's Investors Service has also cut its outlook for the US banking system to 'negative' from 'stable', citing the run on deposits at these three banks that led to the collapse of these banking majors in less than a week.
As regards India, FIIs have pumped in over Rs 34,400 crore in the Indian stocks in calendar year 2021.
Experts said concerns over the Union Budget, too, had weighed on the market performance.
Will 2022 be a year of contrasting narratives -- one filled with caution and the other with continued optimism?
Even though stocks may remain volatile in the run-up to the polls, as political parties stitch up alliances, the long-term trajectory for the markets remains bullish.
Foreign investors keeping off; inflows into bonds also likely to improve if RBI resumes rate cuts.
There has been a stellar rise for the Indian markets this far in calendar year 2021 (CY21) with the S&P BSE Sensex surging over 19 per cent. The gain in mid-and small-cap indices on the BSE has been sharper with both these indexes surging around 38 per cent and 54 per cent, respectively during this period. Rampant spread of Covid pandemic's Delta variant and the ensuing lockdown and mobility curbs across India, rising prices key commodities, including crude oil and its impact on inflation, possibility of tightening of policy stance by major global central banks, especially the US Federal Reserve (US Fed) have been some of the key headwinds that the markets successfully negotiated during this period.
Indian states are preparing for a Rs 1.9 lakh crore (Rs 1.9 trillion) tax windfall this fiscal year.
Some may lose competitiveness due to higher compliance costs
Markets and blue chip stocks may see a downward correction in short-to-medium term.
Experts believe the market will fall between 1 and 3%.
For the sake of transparency, and to reduce undesirable bond market volatility, clarity on these would be welcome, preferably before the budgets for the next fiscal year get finalised, says Neelkanth Mishra.
Experts caution against tough times in Indian equity markets in 2015.
From lack of big reforms to regressive tax policies, the Modi govt has surrendered its initial momentum, says Shishir Asthana.
Indian equities are no longer cheap vis-a-vis global markets, and only a short distance away from being the most expensive they have ever been.
The best of India's brains are instead busy solving the world's problems (I deliberately exaggerate a bit to drive home the point), as our policies incentivise them to do so.
So, what does 2016 have in store for the Indian markets? Will they be able to take a giant leap forward in the leap year, and what are the key risks?
The RBI fell short of pumping Rs 150 billion into the economy at the beginning of 2018-2019.
India's banks are propping up too many weak producers.
In the near term, the key driver will still be the government's fiscal spending.
'While GST and demonetisation are likely to cause disruption for longer than the market currently expects, they can have meaningful positive impact over the medium-term.'
'For those looking at forward-looking signals for the economy from the stock markets, the relative performance of small and mid-caps may be a better indicator of the future than the index levels of the narrower and more popular indices', says Neelkanth Mishra.
Given the concerns around trade wars that threaten to jeopardise global capital flows as well, attracting foreign capital needs to be a policy priority, says Neelkanth Mishra.
Fiscal consolidation is keenly awaited.
In prior elections, not only have opinion poll forecasts been very different from the results, the error margin has increased over time. One need only look at the charts that show the Sensex half a year before and after the results day for the last six elections. The markets did not change direction in any, says Neelkanth Mishra.
Most experts said indices would open higher on Monday and rally might sustain for a few sessions
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